Retired Couple Victims of Predatory Legal System

Observer Op/Ed

The following statement was prepared by retired airline pilot Phil Lane detailing his allegations of how attorneys, in and out of state government in Oregon defrauded him and his wife out of $500,000.00.

In l997 my wife and I purchased a small 20 acre parcel of land in Tumalo, a community NW of Bend, Oregon from the owner/real estate broker Barbara Nicholsen. After the purchase, Nicholsen’s husband told me the adjoining land did not belong to BLM as advertised. Since we had requested land that either adjoined BLM or US forest lands we immediately tried to find out who owned the land. I contacted all the appropriate state and federal agencies that might have an interest in the land and none of them claimed an interest. Finally we found out that the Oregon Water Resource Department thought they might have an interest in the property, a l20 acre parcel of land, ten miles from downtown Bend.

In the meantime we discovered that the land came under a l894 federal law titled the “Carey Act.” This act provided land to eleven western states for homesteading. The states role was to act as trustee, holding the lands in trust for the benefit of the US Government and the eventual settlers. Eventually, approximately 78,000 acres would be deeded out to individual Carey Act homesteaders in the State of Oregon under this program through the l990’s. The Oregon Water Resource Department was the state agency charged with administering the Carey Act within the state.

In our case the two parcels of Carey Act land that we were interested in had not been deeded out or reconveyed to the federal government. The State of Oregon had no information on file about these two parcels. In fact the parcels had fallen off the state’s radar scope and had I not become involved, the State would have been none the wiser.

After calling Washington D.C. to make certain the Carey Act laws were still in effect, and learning the true status of the land, I filled out an application with the Oregon Water Resource Department. To my surprise the state approved our application, at least as to forty acres.

The adjoining Carey Act land had been used by Rock Springs Guest Ranch LLC, a corporation owned by attorneys, who had claimed ownership since l970. In l971 Rock Springs filed a “roll change” document directing the Deschutes County Assessor’s Office to divide off the 80-acre parcel from the master tax account for the state and direct the tax statements to Rock Springs. This particular document was neither signed by whoever prepared the document or the person receiving it on behalf of the county, but Deschutes County accepted it never the less. Then in the mid l970’s Rock Springs filed a bargain and sale deed indicating that Rock Springs was now the “owner” of the 80 acre parcel.

There were no underlying documents to support the transfer to Rock Springs. No contract between the state and Rock Springs has ever been uncovered and the State denies that a contract ever existed. Rock Springs in early l990 built a large storage building on the 80 acres without a building permit or approval by the County. The County Assessor’s Office showed the building on the wrong parcel of land (land actually owned by Rock Springs). The tax assessment for this property was reflected on the home property rather than the 80 acre parcel. Rock Springs complained about the taxes and because of their connections, the taxes were reduced to $2.80 a year on the 80 acres.

When we discovered the actual status of the land (Carey Act), Rock Spring’s attorneys immediately and in our opinion, fraudulently filed as an intervener, claiming adverse possession(against Gov. land). The cases were consolidated and assigned to Marion County Judge Dickey. The case, at the request of Rock Springs and the State was set over 7 times and ended up never going to trial. Rock Springs attorneys and the State of Oregon attorneys cut a deal whereby Rock Springs Corporation, without making application, and in direct violation of Federal law, could buy the property even though the State of Oregon had no authority to sell the land. The State of Oregon as trustee of the lands, under the Carey Act only had authority to either convey the property to an individual or reconvey it to the Federal Government. It specifically could not convey to a corporation as was done in our case.

I hired Portland Oregon attorney Laura Schroader to recover the losses I had suffered as a result of the alleged fraud involving the State of Oregon and Rock Springs attorneys. When she stopped actively pursuing my claim and after I had paid her $170,000.00 in legal fees, she started lying to me about attending court appearances she did not attend. I fired her. I then hired attorneys Margaret Fiorino and Julie Vacura and after paying them $77,000.00 in legal fees and after 4 years of litigation and incurring losses of $500,000.00 including legal fees, I was forced by Judge Dickey to settle for $325,000.00.

I was then threatened by Oregon Assistant Attorney General John Urquhart and told not to try and contact the Federal Government to unravel the deal. Urquhart in a letter to my attorney indicated that the State would “reconvey” the land to the Federal Government before the State of Oregon would legally obtain the land, regardless as to how the court might rule. The state, then to add insult to injury, as part of a good-old-boy insider deal, financed the sale of the property to Rock Springs over 20 years at 6% interest.

When I refused to pay the $32,000.00 that Schroeder said I owed her in legal fees, she sued me. Because neither Fiorino nor Vacura would pursue a malpractice counter claim against Schroader, I hired attorneys Gil Sharp and Tim Vanagas and paid them $80,000.00 to defend me and pursue my excessive fee claim against Schroeder. After a 7 day trial, where the admission of my evidence was restricted by the court, Oregon State Bar Professional Liability Fund attorneys used former Oregon Court of Appeals Judge Jacob Tanzer to falsely testify against me. The jury awarded Schroeder $l6,000.00 in damages which entitled her as the prevailing party to attorney’s fees. Schroeder and the Professional Liability Fund are now asking the judge to award them attorney fees in the sum of $225,000.00.

So after having done nothing more than trying to protect my interest against the fraudulent behavior of a group of corrupt attorneys, I was attacked personally, liabled and fraudulently conspired against by other Oregon State Bar attorneys and the Professional Liability Fund, which is a part of the Oregon State Bar. I suffered total losses in excess of $500,000.00.